]]>Tue, 03 Feb 2015 14:19:53 GMThttp://mikeczekaj.weebly.com/market-thoughts/charts-2315As some astute readers of my blog may know, I'm an avid reader of CFA Institute's Enterprising Investor blog. I thought I would borrow a cool idea that one of their content providers started doing a couple weeks back. This investor basically saves all the charts and pictures he comes across each week and then posts them with a few short comments. Since this is my first post, the charts are from the last several weeks prior, but I will try to regularly keep this up in the future (hopefully each Friday).

The first chart comes from Blackrock and shows the power of retirement saving from an early age. Specifically it shows how much one has to save per month at various ages to accumulate $1MM by age 65. Keep in mind this chart assumes 7% annual returns compounded monthly. With a well-balanced portfolio I think that's pretty achievable.

I love maps and this map from the Wall Street Journal details Europe's gas pipelines. As one would expect, Europe depends pretty heavily on Russia for natural gas. Given the crisis in Eastern Ukraine hasn't subsided, Europe has started to increase its diversification process for the fuel.

The next map is also from the Wall Street Journal and shows which states have to pay sales tax when they order from Amazon.com. We're pretty lucky here in Ohio! I also believe this chart has changed slightly since it was originally published in the fall of 2014 as I'm pretty sure Illinois is collecting sales tax on Amazon purchases now. Good think I moved haha!

The next photo is courtesy of Mattermark. It shows the last 10 years of startup investment by TRANSACTION VOLUME, NOT DOLLAR AMOUNT. It's interesting though as valuations continue to skyrocket because although the number of deals have gone down, I'm almost positive the dollar amount keeps increasing. I will be on the lookout for a chart detailing that in the coming weeks, but for now suffice it to say that seed deals are starting to slow significantly. Can't wait to see what happens when the Fed starts raising rates!

I think this chart that I stumbled upon on Twitter should be scrutinized by all bulls on US drilling activity. It basically shows how quickly shale plays in the US deplete after initial drilling. The top 15% of wells in those plays decline a lot slower than the middle 70%. Will be very interesting to follow in the coming years as US drillers continue to pump for oil and gas. Maybe Saudi Arabia was smart in continuing to produce...they are basically calling the US bluff.

The above chart from the Federal Reserve shows how the FOMC's assessment of inflation changed over 2014. It's important to note that they think the decreases in the price of oil and other energy prices are transitory in nature. To me, I think this shows that the Fed doesn't necessarily have to raise rates any time soon.

Mark Schoenebaum is probably the best healthcare analyst on the sell-side (he works for ISI) and he recently tweeted this picture of biotech IPO volume dating back to 1979! The astute reader will ask if 2014 is a bubble or if something has changed. It's tough to say, but I would also argue that since mapping the human genome has become so cheap (by historical standards) that biotech companies can now target diseases and personalize treatments to make drugs more successful making drug approvals occur at a higher rate. Now on the flip-side every biotech company that has gone public doesn't have a drug that's approved yet, but many do. The others probably want to get relatively cheap financing while the biotech market is hot and rates are low.

The last picture I wanted to post was my old twitter picture because for whatever reason I find it hilarious. Google Hangouts allow you to put these hilarious accessories over your video chat when talking with friends or family. I highly recommend trying it out! Hope you enjoyed the first weekly installment of "Charts" and until next time...

]]>Fri, 30 Jan 2015 13:28:04 GMThttp://mikeczekaj.weebly.com/market-thoughts/is-the-bottom-in-for-gasDespite the volatility, we might be seeing a bottom in the national average of unleaded gas according to AAA data. Take a look at the chart below to check it out yourself!

]]>Mon, 05 Jan 2015 22:16:53 GMThttp://mikeczekaj.weebly.com/market-thoughts/market-wrap-up-1515Markets took a shit today with the S&P 500 closing down 1.83%, while the Nasdaq closed down 1.57%. The 10 year also ended the day at 2.04%. I'm not a big watcher of financial TV, so I don't know what they are panicking about these days, but I would guess that domestic markets were impacted by big down days across Europe as there are renewed fears that Greece is going to leave the Eurozone. CAC 40 was down 3.31%, DAX was down 2.99%, and Euro STOXX 50 was down 3.70%!

It probably doesn't help that crude oil also tanked some 5%+, closing below $50 at $49.88 on reports that Russia continues to pump record amounts of crude and that Iraq is exporting the most oil since 1980. These pieces of oil news are adding to oversupply fears. I wonder every day about when more people are going to start talking about demand fears, which could send prices even lower. Not completely related, but one of my colleagues always likes to talk about how oil was one of the leading-most indicators of the Great Recession.

As opposed to 2014 I'm also seeing some of the more bullish sell-side shops start to become more cautious, which is a little bit worrisome. I'm not so worried about the US economy as it currently stands, but problems in Europe and Japan could spill over very quickly given the increasingly interconnected world we currently live in. Europe really needs to do some sort of QE, but I don't think it's possible for them to do something like the US has done. At the same time, the idea that they are trying to do something similar could be all Draghi needs. Time will tell.

Those are just some of the things I'm thinking about on this cold, snowy Cleveland evening...]]>Fri, 02 Jan 2015 21:19:50 GMThttp://mikeczekaj.weebly.com/market-thoughts/market-wrap-up-1215S&P ended the first trading day of 2015 pretty much flat, while the 10 year decreased to 2.12% and crude ended around $52.60. I take all this as a mild positive considering stocks took a dive after ISM reported its survey on manufacturing this morning. The release missed expectations by the largest margin since January 2014 and also decreased MoM. Within the report there were also big decreases in new orders and prices paid. While perusing twitter I noticed how bearish everyone seemed to be thanks to this big miss and couldn't help but be reminded of the exact same thing happening last year...first big release of 2015 misses and now the world is doomed. I will also note though, that many market participants may have looked past this report evidenced in the market rallying a small amount through the afternoon. In my opinion, the jobs report next Friday is going to be a bigger deal and will set the tone for the first few weeks of trading in 2015.

In terms of other random thoughts for the day...everyone seems to think rate hikes are coming this year, which could impact multiples and send stocks diving, but I can't help but think that the Fed has tried extremely hard to prepare the market for these rate increases that we could continue to see stocks rally barring adverse slowdowns in other developed economies. After all, the markets don't react to expected news. Rate increases will obviously strengthen the dollar and while that may be bad for emerging economies, I think it will very much help places like the Euro Zone and Japan as they rely heavily on exports.

One of my goals is to get my thoughts down in writing more in 2015, so hopefully you all will be able to read more about what I am thinking in the coming days and weeks!]]>Mon, 08 Dec 2014 22:34:52 GMThttp://mikeczekaj.weebly.com/market-thoughts/how-demographics-are-expected-to-impact-gdp-growthI learned about some cool interactive charts when I was listening to one of my favorite podcasts today. The discussion had to do with the importance of understanding demographics when researching investments. Japan was a big topic as the country is expected to see significant headwinds on economic growth in the coming years as the population continues to get older. One way to combat an aging economy is to open up the country to more immigrants. Historically, Japan has been against immigration reform, which will make things tougher for Abe and others going forward .

On the flip-side, emerging economies are expected to continue to see tailwinds on economic growth thanks to teen populations turning to economies that are more young adults. Young adults think differently and are more focused on things like building businesses and supporting families. In my opinion, I think that factor is huge at a time when the US dollar is negatively impacting those economies.

Check out this link to play around with some interactive charts that show how demographics are expected to impact GDP growth in major economies around the world. ]]>Tue, 23 Sep 2014 14:35:27 GMThttp://mikeczekaj.weebly.com/market-thoughts/fed-hawk-down-washington-postJust read a pretty important article in the Washington Post. Titled "Fed Hawk Down: Head of Philadelphia Fed to retire in 2015," the newspaper discusses how Charles Plosser has decided to step down from his duties as a Fed President in March of 2015 aka before when many thought the Fed would start to raise rates. This is important because President Plosser is one of the most outspoken hawks in the FOMC. Does this mean rates will stay lower for even longer? Or will he be replaced by another hawk? Will be interesting to see how this all plays out over the coming year... ]]>Mon, 15 Sep 2014 22:56:36 GMThttp://mikeczekaj.weebly.com/market-thoughts/daily-review-91514I'm not going to do this every single day, but I thought it might makes sense to jot down some thoughts when I see fit. I apologize in advance if there is a lack of structure to my daily reviews...

So today the NASDAQ got crushed (in relative terms), down some 1.1% while the S&P 500 was down about 7 basis points and the Dow was up some 26 basis points. Coincidence that most "zero-coupon stocks," as I like to call them, were crushed the same week the Fed has a very high profile meeting? I think not. Fed interest rate policy is all anyone seems to care about these days, ex the upcoming Alibaba (BABA) IPO, for good reason. We seem be slowly transitioning from a historically unique time where ZIRP ruled the day. Many economists expect the first interest rate hike in the US to come sometime next summer. I think we might see rates being raised after that given the absolutely anemic inflationary environment out there. Barring an international crisis either in Europe or the Middle East, I think US data continues to improve, albeit slowly. Sure things can be lumpy from month to month, but the trends of most all domestic data continue to move in the direction of economic expansion. Again, I think this is why most "zero-coupon stocks" got hammered today. My "zero-coupon stock" index was down 3.96% today vs. a roughly flat market. Obviously these names have been skyrocketing during ZIRP because the discount rates used to value these stocks were close to zero. Basic finance tells us that when the discount rate is increased the present value of the asset being valued decreases. This isn't the first time we've seen this in 2014, so I think the stocks rebound after the Fed press conference on Wednesday, but caveat emptor when it comes to some of the more high-profile stocks in the tech and consumer discretionary sectors. The party could be coming to an end in the coming 6-9 months. I will also say that I think the Fed will only raise rates if they think the economic expansion isn't fragile enough to be impacted by rate increases, which some may argue that any sell-off will be short-lived and the show must go on. While true, I think that valuations will be reeled in as valuations are historically inversely correlated to interest rates. We'll see what Chairwoman Yellen has to say later this week and then we'll get to see how investors in the zeros respond! It might start to become one of those times where you do work/swim out (research, research, research and make stock wish-list for when assets go on sale during a bigger sell-off), wait patiently for a monster swell (market sell-off), and then ride the wave back up! C'mon, you gotta love the corny surfing metaphor, I always relate my investment thoughts to things that I love!

]]>Fri, 05 Sep 2014 18:58:43 GMThttp://mikeczekaj.weebly.com/market-thoughts/inaugural-postHey all! So this is my first go on a basic website where I can talk about the stock market, companies, economics, book reviews and whatever else I find interesting out there that may be relevant to anyone interested in the world of finance! All thoughts and comments are MY OWN. Feedback is always appreciated...always want to know where one disagrees with me! ]]>